Reality Hits Jobless Claims
The dollar index rose by 0.41% yesterday as the fragile risk sentiment in the global markets continue to support the greenback.
This came despite an unexpected rise in the weekly jobless claims yesterday, which revived fears of a slowdown in the world’s largest economy.
America will continue to await fiscal relief as the Presidential elections come closer.
The US reported its biggest one-day jump in infections since July, as both candidates last night participated in separate televised town halls.
EURUSD Closes in on 1.17
The euro became another casualty of the shift in sentiment on the greenback. The EURUSD pair closed 0.42% lower on Thursday as lockdown 2.0 came into full swing across Europe.
Infection rates have been at their highest ever, however, the death toll seems to have eased signaling a glimmer of hope for the weak economy.
We now await today’s CPI figures for September that should largely reaffirm more subdued inflation pressures going into Q4.
Brussels Drags its Feet Over Trade Deal
The failure of securing a Brexit deal before the original deadline led the pound to decline by 0.83% on Thursday.
Post-Brexit trade talks are expected to grind on despite Boris Johnson’s deadline.
EU chief Brexit negotiator Michel Barnier was urged to continue negotiations with the UK. He has been quoted to say that he is determined to reach a fair deal, but not at any price.
The question now remains when the next deadline will be if there is one.
Indices Lose Their Handle
The indices closed lower for a third day yesterday as a recent attempt at record highs hit the brakes.
Traders will now look towards today’s latest retail sales data in the hopes of a rebound.
Since any form of stimulus package looks bleak before the election, we could see a further downturn in the equity market.
Risk Sentiment Remains Despite Dollar Strength
Gold turned positive on Thursday as it reclaimed the $1900 handle, ending the session 0.34% up.
This comes despite the generalized strength of the US dollar making the majority of headlines.
The precious metal seems to be taking advantage of its safe-haven status as we close in on November’s US election.
EIA Draw Keeps Oil Elevated
Oil closed slightly lower yesterday despite the EIA reporting that US crude inventories fell by 3.8 million barrels last week.
Downward pressure remains strong as Libya continues to ramp up its oil output. In addition, Russia said OPEC+ was sticking to its plan to further relax production cuts, despite the feared second wave of Covid-19 infections that could dent demand again.